Definition and basics of economic espionage
Economic espionage is the targeted procurement of business and trade secrets as well as other economic information by unauthorized third parties in order to gain an economic advantage. It includes activities motivated by both state and private-sector interests, and is clearly regulated by law in Germany and internationally. The distinction between so-called industrial espionage, competitor espionage, or know-how theft is fluid, with the term economic espionage generally presupposing actions taken with or in the interest of state authorities.
Legal foundations in Germany
Criminal relevance
In Germany, economic espionage constitutes a criminal offense, which is regulated both by the German Criminal Code (StGB) and by supplementary protective laws. Relevant regulations particularly include Sections 17 to 19 of the Act Against Unfair Competition (UWG) as well as certain provisions of the Criminal Code, such as Sections 202a ff. StGB (data and computer crime) and Sections 94 ff. StGB (treason and betrayal of secrets).
Section 17 UWG – Disclosure of business and trade secrets
Section 17 UWG explicitly protects against unauthorized disclosure or exploitation of business or trade secrets, for example, obtained through employment with a company. Punishable are both the perpetrator who discloses or exploits the secret and the person who receives the secret.
Sections 18 and 19 UWG – Extended criminal provisions
Section 18 UWG extends the scope of protection to the disclosure and exploitation of trade secrets in the public interest. Section 19 UWG regulates the criminal liability in relation to third-party involvement, such as through incentives, support, or joint commission of the offense.
StGB – Treason and corporate context
Sections 94 ff. StGB impose severe penalties for the transmission of business and trade secrets to foreign states. If the perpetrator acts on behalf of state authorities or in direct connection with foreign intelligence services, the offense of treason (Section 94 StGB) or activities as a secret service agent (Section 99 StGB) commonly applies.
Legal distinction from competitor espionage
Whereas economic espionage frequently involves a state background, competitor espionage usually refers to the spying out of trade secrets by competitors. This scenario is also covered by Sections 17 ff. UWG and certain offenses under the Criminal Code.
Aspects of data protection law
With the entry into force of the General Data Protection Regulation (GDPR) and the Federal Data Protection Act (BDSG), further implications arise if personal data are obtained as part of economic espionage. Civil claims for damages pursuant to Art. 82 GDPR can also be relevant if companies or affected individuals suffer damage as a result of the espionage.
Economic espionage in an international context
International agreements and cooperation
Economic espionage often has a cross-border character. Therefore, there are numerous international agreements and international cooperations to combat economic espionage and to protect confidential economic information. A well-known example is the Wassenaar Arrangement, which regulates the export of dual-use goods and technologies. Cooperation within the EU is also governed by Directive (EU) 2016/943 on the protection of undisclosed know-how and business information against their unlawful acquisition, use and disclosure.
Prosecution and legal assistance
The cross-border prosecution of economic espionage cases is complex and subject to international mutual legal assistance treaties as well as to specific investigation procedures by national security authorities. The European Police Office (Europol) and the international police organization Interpol support national authorities in the prosecution, collection, and analysis of relevant economic offenses.
Protective measures and compliance within companies
Preventive measures
Under current law, companies are required to take appropriate technical and organizational measures to protect their business and trade secrets. The need for effective protective measures arises from the Trade Secrets Act (GeschGehG) as well as from employment law and contractual ancillary obligations.
Technical and organizational precautions
These include, among other things, IT security structures, access restrictions, encryption of sensitive data, as well as training employees regarding the sensitivity and confidentiality of trade secrets.
Contractual arrangements
Non-disclosure agreements (NDAs) and non-compete clauses are used to provide legal security in addition to technical measures. They serve as the civil law basis for claims for injunction and damages.
Response options in the event of espionage incidents
If companies fall victim to economic espionage, both civil and criminal legal actions are available. In addition to filing complaints with law enforcement authorities, preliminary injunctions can be obtained, as well as claims for injunction and damages. Cooperation with specialized authorities, such as the Federal Office for the Protection of the Constitution (BfV), is also among the essential immediate measures.
Consequences of economic espionage
Criminal sanctions
Consequences for offenders range from fines to several years of imprisonment. Particularly serious cases, such as the betrayal of state secrets in favor of foreign states, may be punished with imprisonment of up to ten years (Section 94 StGB). Seizure of items and disgorgement of assets obtained through the offense are also possible.
Civil law consequences
In addition to criminal consequences, companies whose secrets have been spied on may assert claims for injunction and damages. The prerequisite, however, is that a business or trade secret protected by law exists and that the necessary proof of unauthorized acquisition can be provided.
Employment law consequences
For employees, an incident of economic espionage may lead to dismissal or even criminal proceedings. Confidentiality and ancillary obligations under the employment contract are significantly violated by economic espionage.
Economic espionage in the digital age
Digitalization has massively expanded both the methods and threat potential of economic espionage. Cyberattacks, phishing, social engineering, and advanced persistent threats (APT) are typical manifestations of digital economic espionage. There are specific IT security laws, such as the IT Security Act (IT-SiG) in Germany, which obligate operators of critical infrastructures to implement special protective measures.
Distinction from other offenses
Economic espionage must be distinguished from white-collar crime in the narrower sense (such as fraud, embezzlement), patent and trademark infringements, as well as classic competitor observation, where only publicly accessible information is used. Only actions specifically aimed at spying on, stealing, or passing on non-public business or trade secrets are punishable.
Summary and outlook
Economic espionage is a multifaceted offense that is extensively regulated by law. Both national lawmakers and international bodies provide a network of criminal, civil, and data protection laws aimed at protecting the trade secrets and economic interests of companies from state, private, and international threats. As digitalization progresses, both risks and legal requirements for the protection of secrets increase, necessitating ongoing adjustments to legal and technical measures.
Frequently asked questions
What are the criminal consequences of proven economic espionage?
Economic espionage constitutes a criminal offense in Germany, regulated in particular by Sections 17 and 18 of the Act Against Unfair Competition (UWG) as well as Sections 202a ff. of the Criminal Code (StGB). Depending on the severity of the offense, the extent of business or trade secrets obtained, and the resulting financial damage, prison sentences of up to five years or, in especially serious cases, up to ten years may be imposed. In addition to imprisonment, the court may also impose fines. Furthermore, civil claims by injured companies such as injunctions, claims for damages, and, where applicable, the destruction or return of unlawfully obtained information may arise. The offense is considered particularly serious if the perpetrators act on a commercial basis or on behalf of foreign intelligence services—in such cases, further provisions of the StGB usually apply. Companies can also apply for blacklisting or a general professional ban for responsible managers. International aspects further complicate legal enforcement, which is why the Foreign Trade and Payments Act (AWG) may also be relevant.
What legal options do companies have to defend themselves against economic espionage?
In cases of suspicion or damage, companies can primarily rely on civil legal remedies. They may apply for a preliminary injunction or bring a main action against suspected perpetrators and request that further spying be prohibited (injunctive relief according to Section 8 UWG). Under Section 9 UWG, they can also claim damages if economic espionage has demonstrably caused financial loss. Before the courts, the return or destruction of the stolen information can also be demanded. Support is also available through the option to file a criminal complaint with the competent public prosecutor. Investigative authorities can secure evidence through search warrants and seizures. However, companies must prove that they have adequately protected their trade secrets, otherwise civil claims may be denied. In an international context, mutual legal assistance between states is often a decisive but not always smoothly functioning aspect of legal enforcement.
How does economic espionage differ legally from industrial espionage?
While the terms are often used synonymously in everyday language, there are important distinctions in the legal context. Economic espionage generally refers to the spying of business and trade secrets on behalf of a foreign state or a state-related body. German criminal law treats this as a particularly serious crime and provides increased penalties according to Section 17 (2) UWG or Section 19 (1) No. 1 UWG. In contrast, the term industrial espionage is used when private individuals, competing companies, or individuals without state involvement spy on or steal trade secrets. This form is usually prosecuted under Section 17 UWG or Sections 202a ff. StGB. The difference primarily affects the penalty and international prosecution, as state-controlled crimes frequently fall under the Foreign Trade and Payments Act (AWG) and international law.
What are the statutory requirements for the protection of trade secrets in the affected companies?
According to the Trade Secrets Act (GeschGehG) and the UWG, only those trade secrets for which the company has taken appropriate confidentiality measures are protected by law. Such measures may be organizational, technical, or contractual—for example, access and admission controls, encryption, confidentiality agreements with employees and business partners, and regular training. In the absence of protective measures, a court may dismiss an espionage claim because the information would then not be considered worthy of protection. The law requires that the protective measures used be appropriate to the value and sensitivity of the secret. The burden of proof lies with the claimant company, which should document the protective measures taken as thoroughly as possible in case of a dispute.
What role do international agreements play in the legal prosecution of economic espionage?
International agreements such as the European Convention on Mutual Assistance in Criminal Matters and bilateral treaties between states enable cooperation in the prosecution of economic espionage across national borders. These legal instruments serve to secure evidence, extradite offenders, or exchange information. Within the EU, the provisions on the European Arrest Warrant and the Directive on the protection of trade secrets also apply. Nonetheless, there are often limitations: Not all states cooperate fully, and especially in state-led espionage, investigations are often hampered by political interests and immunities. This frequently makes the practical implementation and legal enforcement of claims arising from economic espionage cases more difficult.
How are violations of the GeschGehG and the UWG prosecuted under criminal law?
Violations of the GeschGehG and the UWG are prosecuted under criminal law, either by the public prosecutor’s office or within the framework of private prosecution proceedings when they become known. As a rule, this requires a criminal complaint from the injured party, although the public prosecutor may also act ex officio if there is a particular public interest. Investigations generally include securing electronic data, hearing witnesses, and seizing potential evidence. During the court proceedings, each element of the offense—for example, the existence of a trade secret, unauthorized acquisition, and deliberate disclosure—must be clearly proven. Depending on the nature of the espionage, the criminal proceedings can result in imprisonment or fines and may entail accompanying civil proceedings.
What defense options are available in the case of an allegation of economic espionage?
In the event of an allegation of economic espionage, the accused has numerous possible defenses. One key approach is to prove that there was no adequately protected trade secret or that the information was already publicly accessible by other means. Challenging the manner in which evidence was obtained, for example in cases of unlawful searches or violations of the right to a fair trial, can also significantly contribute to the defense. Sentences can be mitigated through cooperation with investigative authorities or comprehensive confessions. In individual cases, it can also be argued that there was no intentional or unauthorized action, but rather a mistake or access made with the company’s consent. The defense should always be conducted by specialized defense lawyers with experience in white-collar criminal law to ensure the best possible chances of success.
